Amid caution surrounding interest rate settings in the United States and Brazil, the dollar closed above R$5 for the first time since the end of October. The stock market closed slightly higher.
The commercial dollar closed this Monday (18) sold at R$ 5.026, an increase of R$ 0.028 (+0.57%). The price opened with a slight drop, but started to rise after the opening of the North American markets. At its peak of the day, around 12pm, the US currency reached R$5.03.
The price is at the highest level since October 31, when it closed at R$5.04. The currency accumulates an increase of 1.09% in March and 3.56% in 2024.
In the stock market, the day was also marked by instability. The Ibovespa index, from B3, closed at 126,954 points, up 0.17%. Mining shares recovered from the declines of recent days with the rise in the international price of iron ore. However, shares of oil companies and electricity companies fell.
In the foreign exchange market, expectations regarding interest rates in Brazil and the United States predominated. On Wednesday (20), the Federal Reserve (Fed, North American Central Bank) and the Central Bank’s Monetary Policy Committee (Copom) decide the basic interest rates in the United States and Brazil.
Recent data indicating the warming of the North American economy has increased bets that the Fed will only start cutting interest rates in June. High rates in advanced economies encourage investors to flee emerging countries.
In Brazil, the expectation is that the Copom will make a new cut of 0.5 points in the Selic Rate. However, data that indicates a warming of the Brazilian economy, such as the GDP preview released this Monday by the Central Bank, increased the chances that the BC will stop cutting the Selic in June. A smaller-than-expected drop encourages investors to migrate from the stock market to fixed income investments.
*With information from Reuters.
